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Sample Comment Letter

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Francois K. Gregoire

Thread Starter
Senior Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Hi All,

As you know, the Appraisal Standards Board has submitted a request for written comments on proposed changes to the 2002 USPAP. If you are interested, here is a sample comment letter similar to one sent today to their fax machine

(202) 347-7727 or (202) 624-3053

Comments can be emailed to [email protected]

Feel free to use, modify, agree, disagree, flame, edit or trash what follows, but please let them know what you think about the changes proposed.

What is proposed WILL have an effect on the way you conduct your business. This is a chance to participate in the process rather than sit back and watch what happens to you.

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March 30, 2002


Mr. Danny Wiley, Chairman
Appraisal Standards Board
The Appraisal Foundation
1029 Vermont Avenue N.W..
Washington, D.C. 20005-3517

RE: Request for Written Comments
Exposure Draft on proposed revisions to the 2002 Edition to the Uniform
Standards of Professional Appraisal Practice

Dear Mr. Wiley:

Thank you for the opportunity to provide comments on the proposed revisions to the 2002 Edition to the Uniform Standards of Professional Appraisal Practice. The following are my personal comments and not reflect the views or opinions of any professional association or other entity.

Section 1 - Standards Rules 1-5 and 7-5 (Property Sales History)

This does not appear to be an issue with an immediate and pressing need for clarification and modification. However, if making the change alleviates the concern and regulatory uncertainty experienced by some users and entities, there is no harm done with the adoption of the changes proposed in Option 1.

Adoption of the changes proposed in Option 2 may confuse the issue by moving the topic of sales history to a different Standards Rule. Casual readers of the USPAP may miss the change regardless of attempts by the ASB, Instructors and Regulators to keep them informed.

Section 2 - Advisory Opinion 3 (AO-3) and Statement No. 7 - Updating an Appraisal

The efforts of the Appraisal Standards Board to simplify the issue of Updating an Appraisal are well founded and in the right direction. The wide variation in terminology used by a multitude of client groups this has been a significant area of confusion on the part of practitioners. You have my full support of the rationale and the changes proposed to Advisory Opinion 3 and Statement No. 7.

Section 3 - Advisory Opinion on Jurisdictional Exception

While this may be a popular topic for discussion among various regulatory boards and some client groups, the proposed Advisory Opinion with its attendant explanation and examples appears to be an excessive response to the question at hand. Some user groups and regulatory boards, failing to find in a specific situation explained or offered as an example in the Advisory Opinion, may make an erroneous interpretation. All your efforts will then be for naught.

The problem perceived with the understanding of The Jurisdictional Exception Rule might be clarified in a more simple and direct manner by inserting a short segment of text into the rule itself. We suggest inserting the text from lines 352 - 356 in the Exposure Draft after line 480 on page 13 of the 2002 USPAP

In order to properly employ this Rule, the appraiser must ensure that there is proper legal authority in affect for the particular situation, such as a specific statute, administrative rule, judicial precedent, or other similar law or public policy. In addition, this Rule requires the appraiser to specifically identify in the report the part (or parts) of USPAP disregarded and to also identify the legal authority that justifies this action.

This short segment of text clarifies the Jurisdictional Exception Rule and makes the interpretation binding. Including the explanatory text in an Advisory Opinion would not bind users to the interpretation offered by the Appraisal Standards Board.

Section 4 - Advisory Opinion on Appraising properties Impacted by Environmental Contamination.

My recommendation is not in favor of including the proposed Advisory Opinion in USPAP.

The existing Advisory Opinion 9 adequately describes the responsibilities of Appraisers involved in appraising contaminated properties under the Hypothetical Condition the property is not contaminated. The Ethics and Competency rules are properly referenced in the present Advisory Opinion 9 and it illustrates the applicability of existing Standards.

Developing an opinion of “as is” value of a of contaminated properties is no different than the appraisal of other specialized properties. This proposed advisory opinion is instructional and may have the undesired effect of confusing, rather than clarifying this issue. This may be a case where less is more. The Appraisal Standards Board’s enumeration of methodologies and suggestions of a framework might tend to encourage an appraiser to tackle an assignment beyond the level of their expertise and competence and give them a false sense of security and “compliance” with the USPAP.

Including an Advisory Opinion in the USPAP such as the one proposed, will surely prompt calls for Advisory Opinions to cover other special situations and appraisal problems. Some of us view the USPAP as a compilation of requirements for professional appraisal practice, rather than an instructional text. Please do not succumb to calls to include every eventuality or problem encountered as an Advisory Opinion.

Section 5 - Revisions to Standard 3

I agree with the rationale expressed and support the proposed revisions.

Section 6 - Segmentation of USPAP by Appraisal Discipline

Thanks for your diligence and continued efforts on the segmentation of the USPAP by Appraisal Discipline. Improving the understanding and esefulness of the document may be a result, but his appears to be a formidable task and one not accomplished by simply attaching labels to Standards Rules, Statements on Appraisal Standards and Advisory Opinions. You illustrated an attempt in the simplification direction by using
the table on page 29 of the Exposure Draft to illustrate the Segmentation yopics supported by the Appraisal Standards Board. It helps to demonstrate the focus of your efforts. The proposed edits on pages 31 through 35 however, illustrate the core of the problem and enormity of the task.

With the exception of the Preamble, Rules, Standards and Standards Rules, which are logically and carefully presented, the haphazard and random arrangement of over 66% of the document is blatantly conspicuous. The document, after page 81, lacks order, clarity and precision. The order of the Statements on Appraisal Standards and Advisory Opinions is clearly the result of the sequence of their adoption without regard to appraisal discipline or priority. These comments are made not to be critical of the ASB, but merely to underscore the complexity of the job you face.

While the proposal offered by the ASB might be a step towards the goal to improve clarity, it does not correct the underlying cause which is the current structure and arrangement of the material. Rather than attempting to mask this fault, and risk additional confusion, it might be wise to make an attempt to lay a proper and sufficient foundation and develop a format for a more orderly presentation of the Supplementary
Information (Statements on Appraisal Standards and Advisory Opinions) using the presentation of the Standards and Standards Rules as the model.

Development of a numbering or lettering scheme to coordinate or link Statements on Appraisal Standards and Advisory Opinions to corresponding Standards and Standards Rules and/or to specific appraisal disciplines would go a long way to enhancing readability and clarity as well as the appearance and credibility. If developed properly, the correlation among various sections, standards, statements and advisories could become intuitive to readers and users of the USPAP Document.

Yes, this is a radical departure from your proposal. However, on the fifteenth anniversary of USPAP, isn’t it time to take a bold step and recognize the underlying deficiency in the structure of the document? All of us would benefit if the Appraisal Standards Board steps back and takes the time and effort to construct an adequate and proper organizational framework capable of supporting the inevitable future additions, opinions and clarifications.

Section 7 - Certifications for Multi-discipline Reports

The addition of this language works against the goals stated in Section 6 -
Segmentation of USPAP by Appraisal Discipline. The rationale cited in the Exposure Draft references primarily users of appraisal services rather than providers of appraisal services and cites one example of an appraisal report with three separate certifications.

Let’s face it, this is a management issue. Appraisers routinely rely on other experts in the development of an opinion of value and can properly disclose their contribution in their appraisal reporting. If the scope of work for each contributor is adequately stated, well constructed Limiting Conditions can easily handle this hypothetical problem.

Making changes as significant as those proposed with minimal rationale and applicability does not serve to simplify the USPAP, nor does it make it more understandable.

Section 8 - Definition of Subject Property

Statements made by the ASB in your rationale and recommendations to include a definition of “subject property” prompted a search of real estate and appraisal texts and dictionaries. The lack of a definition of this term appears to be common and does not appear to be a deficiency.

Failure to include a definition of subject property in the USPAP does not hamper enforcement actions, in my opinion. Including the proposed definition may cause more problems than those solved. In some cases it may be defined by law, by rule, judicial precedent, custom or public policy. It is not certain including the definition would make USPAP more clear and enforceable. As such, I disagree with the proposal and recommendation.

Section 9 - USPAP Compliance

Thanks for all the rationale, explanation, proposed solution and recognition of the Appraisal Standards Board’s inability to make, judge or enforce law. By your own admission, the language you propose to change was new in 2001. Either keep the existing language (which does no harm since the ASB has no ability to enforce) of remove it. What is the rationale for substituting another string of unenforceable text?

Thank you for this opportunity to provide comment on the changes proposed to the 2002 Uniform Standards of Professional Appraisal Practice. Your goal to simplify and clarify the document are commended. Practitioners, clients and regulators will benefit if this objective is attained.


Sincerely,
 

Wally Jones

Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Frank,

Thank you for your continuing efforts. As a relatively new appraiser, I often struggle with how to go about effecting change and if it's really worth the effort. When I consider the alternative of taking no action, I realize it's always worth the effort. My letters have been mailed.

Wally
 

Francois K. Gregoire

Thread Starter
Senior Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Florida
Frank,

Thank you for your continuing efforts. As a relatively new appraiser, I often struggle with how to go about effecting change and if it's really worth the effort. When I consider the alternative of taking no action, I realize it's always worth the effort. My letters have been mailed.

Wally
Wally,

In many ways, this is similar to voting. We all complain about the state of affairs, but the effect of our complaints and suggestions for improvement is insignificant if we do not take full advantage of our rights and fulfill our responsibilities as citizens and professionals.

Thanks for taking the time to weigh in and participate.
 
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